AR Medicaid Demonstration Adds 9-Month Re-Enrollment Block

Arkansas is the latest state to use a 1115 Medicaid Demonstration to add work requirements and a nine-month re-enrollment block for individuals who don't comply.

March 09, 2018 - Arkansas received approval from CMS for a 1115 Medicaid demonstration that adds work requirements for Medicaid eligibility and adds a nine-month block on member re-enrollment if individuals don’t find work.

Arkansas’ demonstration, entitled Arkansas Works, requires individuals between ages 19 and 49 to work or participate in job training activities or other community engagement activities approved by the state for 80 hours a week. Beneficiaries will also be required to report their work activity through an online portal in order to maintain Medicaid eligibility.

Members who fail to report or participate in community engagement activity for any three months after June 1st, 2018 will immediately be removed from Arkansas Works. Removed members are unable to re-enroll until the next plan year.

The state assured potential beneficiaries that vulnerable populations, such as the medically frail or pregnant are exempt from work requirements. Exemptions are also earned from unanticipated events beyond a beneficiary's control.

“After the beneficiary receives notification of disenrollment for either noncompliancewith community engagement requirements or for failure to report, eligible beneficiaries may request a good cause exemption,” the demonstration approval reads.

“If Arkansas determines the beneficiary’s failure to comply or report compliance was the result of a catastrophic event or circumstances beyond the beneficiary’s control, the beneficiary will receive retroactive coverage to the date coverage ended without need for a new application.”

Eligible Arkansas Works beneficiaries will receive lower premium amounts and cost-sharing totals dependent upon their incomes. Premiums and cost-sharing amounts are capped at 5 percent of a family’s monthly or quarterly income.

Beneficiaries above 100 percent of the federal poverty level (FPL) will be required to pay monthly premiums of up to 2 percent of household income, the demonstration stated.

The Arkansas Works program provides beneficiaries with incomes below or just at 100 percent of the FLP $0 cost-sharing. Members with incomes above 100 percent of the FLP will have cost-sharing consistent with Medicaid requirements.

Member benefits will additionally change as members who previously qualified for the state’s employer premium assistance program will move into a state-developed Qualified Health Plan (QHP).

QHP members receive essential health benefits by choosing one of two silver-tier plans, as well as healthcare access to federally qualified health centers and rural health centers. QHP plan holders can earn additional benefits for making timely premium payments and engagement with their primary care provider.

Additionally, QHP members will be able to access wrap-around benefits not currently covered under the plans, such as non-emergency transportation to medical facilities and early diagnosis screenings for members under age 21. The state will provide these separate benefits through the Medicaid fee-for-service system.

Two other states have also incorporated strict work requirements for Medicaid eligibility within the past three months, indicating an emerging trend of state governments wanting to hold members accountable for personal responsibilities.

Indiana used a 1115 waiver to develop work requirements and add premium penalties for tobacco users. The state also plans to use an enrollment block on members who fail to meet work requirements.

Kentucky was the first state to receive CMS approval to implement Medicaid work requirements for able-bodied beneficiaries in its Medicaid populations.

Governor Asa Hutchinson (R-AR) expects the new Medicaid demonstration to improve economic stability for eligible members and transition them into better financial situations.

“I have often said that Arkansans understand the dignity of work, “Hutchinson said in a press release. “The approval of this work requirement will go a long way to create opportunities for able-bodied working-age Arkansans to enter into training or employment and ultimately climb the economic ladder.

CMS Administrator Seema Verma made an appearance in Arkansas to confirm the approval and believes that the implementation of work requirements allows members to improve their quality of life by transitioning out of public payer programs.

“The Trump administration is dedicated to advancing policies that make Medicaid a pathway out of poverty by empowering states like Arkansas to design programs that meet the unique needs of their citizens,” Verma said.

“We owe it to Americans all across this country to support new ideas and innovative solutions to improve health outcomes that can promote upward mobility and an improved quality of life.”

The urgency of state and federal officials to use 1115 demonstrations may lead to unnecessary administrative barriers for Medicaid-eligible individuals and under-reported Medicaid outcomes, according to multiple healthcare experts.

The Kaiser Family Foundation found that 78 percent of Medicaid members nationwide already have part- or full-time work, which would create administrative hurdles for members if they have to constantly report their work status or exemption status.

A Government Accountability Office (GAO) report discovered issues in 1115 reporting, which included gaps in demonstration quality data. GAO suggested that CMS incorporate written and standardized procedures to ensure that federal and state leaders can evaluate 1115 program effectiveness.